Agri Picks Report – September 16, 2024: Geojit Financial Services

Introduction:

Global Oilseed Production Forecasts: The US Department of Agriculture (USDA) has adjusted its worldwide oilseed production estimate for the 2024-25 season downwards to 687.Forty two million tonnes, a decrease of 3.1 million tonnes from the previous month’s forecast. This reduction is attributed to lower production of groundnuts and cottonseed inside the United States, in addition to decreased rapeseed and sunflower yields inside the European Union and Ukraine.

US Oilseed Production: For the US, oilseed production is projected to be 134.71 million tonnes, marginally revised from last month’s estimate of 135 million tonnes. Despite this stability, the USDA anticipates a slight increase in global ending stocks of oilseeds to 151.14 million tonnes, up from 150.63 million tonnes previously.

Soybean Market Dynamics: Global soybean production is forecasted to rise slightly to 429.20 million tonnes, up by 47,000 tonnes from last month. Production estimates for major producers such as Argentina, China, and Brazil remain unchanged, with Argentina’s output steady at 51 million tonnes and China’s at 20.7 million tonnes.

However, Paraguay’s soybean production has been revised up to 11.20 million tonnes from 10.7 million tonnes, contributing to an increase in global soybean exports, now expected to reach nearly 182 million tonnes, up from 181 million tonnes.

Geojit Financial Services Agri Picks Report: Key Insights on Oilseed and Soybean Markets – September 16, 2024:

Price and Supply Expectations: The USDA forecasts that the season-average US soybean price will hold steady at $10.80 per bushel. Similarly, prices for soybean meal and soyoil are expected to remain unchanged at $320 per short tonne and 42 cents per pound, respectively. Global soybean meal production for 2024-25 is slightly adjusted to 271.95 million tonnes, up from 271.87 million tonnes, reflecting stable demand.

India’s Soybean Meal Production: India’s soybean meal production is projected to remain stable at 880,000 tonnes for 2024-25, unchanged from the previous forecast. The 2023-24 production is estimated at 904,000 tonnes. As a major importer of soyoil and exporter of soybean meal, India’s production stability is crucial for global supply chains.

Analysis:

The USDA’s downward revision of global oilseed production highlights ongoing challenges in key producing regions, reflecting a trend towards tighter supplies. The stable outlook for US soybean prices amidst these production adjustments suggests a balancing act between supply constraints and stable demand.

Paraguay’s increased soybean output and the slight uptick in global soybean exports point to a more diversified global supply base.

The USDA’s downward revision of global oilseed production highlights ongoing challenges in key producing regions, reflecting a trend towards tighter supplies. The stable outlook for US soybean prices amidst these production adjustments suggests a balancing act between supply constraints and stable demand. Paraguay’s increased soybean output and the slight uptick in global soybean exports point to a more diversified global supply base.

For Indian producers and exporters, maintaining consistent soybean meal production amidst fluctuating global supply dynamics could offer strategic advantages. The stability in India’s production forecasts aligns with its critical role in the global soybean meal market.

Conclusion:

As the market adapts to these adjustments, stakeholders should remain vigilant to further updates from the USDA and other key agricultural agencies to navigate the evolving landscape of global oilseed and soybean markets.

Frequently Asked Questions FAQ –

1. What does the recent USDA report say about global oilseed production?

The USDA has revised its global oilseed production estimate for the 2024-25 season to 687.42 million tonnes, down by 3.1 million tonnes from last month’s forecast. This decrease is primarily due to reduced production of groundnuts, cottonseed, rapeseed, and sunflower in various regions.

2. How has the oilseed production forecast for the United States changed?

For the United States, the oilseed production forecast remains relatively stable at 134.71 million tonnes, compared to the previous estimate of 135 million tonnes. The stability in US production contrasts with the global reduction, highlighting specific regional production issues.

3. What are the current projections for global soybean production and exports?

Global soybean production is projected to increase slightly to 429.20 million tonnes. Exports are expected to rise to nearly 182 million tonnes, driven by higher exports from Paraguay. The forecasts for major producers like Argentina, China, and Brazil remain unchanged from last month.

4. How are soybean prices expected to trend?

The USDA forecasts that the season-average US soybean price will remain steady at $10.80 per bushel. Similarly, prices for soybean meal and soyoil are expected to hold at $320 per short tonne and 42 cents per pound, respectively.

5. What changes have been made to the soybean meal production forecasts?

Global soybean meal production is slightly adjusted to 271.95 million tonnes, up from 271.87 million tonnes. This increase reflects a marginal rise in production, which is crucial for the poultry feed industry.

6. How is India’s soybean meal production forecasted?

India’s soybean meal production is projected to remain steady at 880,000 tonnes for the 2024-25 season, unchanged from the previous forecast. This stability comes despite a slightly reduced production estimate of 904,000 tonnes for 2023-24.

7. Why are the forecasts for Paraguay’s soybean production important?

Paraguay’s soybean production forecast has been revised up to 11.20 million tonnes from 10.7 million tonnes. This increase plays a significant role in the global soybean export market, contributing to higher overall export projections.

8. What are the implications of these forecasts for global oilseed markets?

The revised forecasts indicate tighter global oilseed supplies due to reductions in key producing regions. Stable soybean prices amid these adjustments suggest a balanced demand and supply scenario. For stakeholders, monitoring these trends is essential for strategic planning and investment decisions.

9. Where can I find more detailed information on these reports?

For a comprehensive overview of all commodities and detailed analysis, you can refer to the full report available through Geojit Financial Services or access it through their website for the latest updates and detailed insights.

10. How should investors approach these market changes?

Investors should consider the potential impact of reduced global oilseed supplies and stable prices on their portfolios. Consulting with financial advisors or certified experts is recommended to make informed decisions based on the latest market trends and forecasts.

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